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What Are Whole Foods Porter's Five Forces Model

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Porter’s Five Forces Model of Competition
As explained below, Whole Foods Market faces intense pressure in four of the five elements of competition. For WFM to remain competitive and continue its dominance within the industry, they must thoroughly address each of these forces. To continue their profitable ways, WFM must identify strategies to reduce cost, enabling them with the ability to shake the “Whole Paycheck” stigma.
Intensity of Rivalry: With a highly saturated retail industry, it’s no surprise Whole Foods Market practices under strong external forces that contribute to highly competitive rivalries. Companies within this sector compete in many different aspects including price, service, and quality. As previously discussed, WFM’s chooses to differentiate itself based on the strategy of offering high quality products; which positions them as the high cost, premium retailer. As a result of this positioning, WFM faces strong competition because of low switching costs and becomes a …show more content…

Within the specific organic segment of the grocery industry, WFM has three main competitors: Fresh Market, Sprouts Farmers Market, and Trader Joe’s. Since all four grocers compete in the same specialty organic niche, the strategic group map allows for a visual differentiation. The three data point used for this map include numbers of stores, total revenue, and the Consumer Reports Supermarket Rankings of 2015. As the map shows, both WFM and Trader Joe’s are very similar in both number of store and total revenues. The main difference between the two is consumer satisfaction, with the primary knock on WFM being high pricing. The other two competitors are almost identical in all three

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